Home Improvements That Don't Add Value

Dated: January 18 2022

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One of the goals of home ownership is to build equity and as we sit around and we think about our home and where we live, we think about home improvement projects that we could do that will increase our home's value.  However, I want to talk about five home improvement projects that people believe add a lot of value to their home, but once it comes time to sell, they don't really add much to the bottom line.


5. Landscaping

Yes, it's true. If you don't have anything living in your yard, your curb appeal is awful. Going out and hiring an expensive landscaper to put in flower beds in different sections of the yard and have it done professionally for tens of thousands of dollars will not yield that type of return once you get ready to sell. A few plants here and there that you put in yourself for a lot less money will increase the value as much as hiring the expensive landscaper in the mind of a buyer.

Buyers look more at square footage, how many bedrooms and bathrooms the home has. Outside curb appeal helps to get you more lookers, but it doesn't really add to your bottom line.


4. Replacing Windows

Updating the windows. Yes, I did this in my home as well. Go out, take the old aluminum-framed windows or wood-frame windows, replace them with the new, state-of-the-art, double-paned, filled with gas, energy-efficient windows. Yes, it has more than paid for itself in the energy efficiency and what it's done for my home, but for a new buyer, again, they may look at those old windows and think, "Hmm, I've got to replace those at some point. What's that going to cost me?" But just because the windows have been updated, they don't say, "Hmm, they put $30,000 worth of windows in this house, maybe I should give them $30,000 more, hmm." Not exactly how it works in the real estate world.


3. Swimming Pool

Man, I'm here to tell you, 100 degrees in Texas days, everyone wants a swimming pool at their house. Well, almost everyone. A lot of buyers don't want the expense and the hassle that go along with the swimming pool. They look at it as an evil, in some ways.

I know that when we had our swimming pool at my home, just the chemical bill alone, along with hiring someone to come and maintain it for us, was running somewhere between 500 and $1,000 a year.

So, if you go out and spend 60 to 120 thousand to install a new pool, deck, and landscaping the return on investment is minimal at best.  Once someone comes to purchase your home, it's not really figured into the appraisal, and you limit yourself on the number of potential buyers that you may have looking into your home.


2. Solar Panels

This may be controversial for some, but installing solar panels becomes a liability. Solar will reduce your electric bill in fact, that's the way it's marketed.  They come in, they ask how much your electric bill is, they show you a plan.  "Hey, we can lease this for the same amount you were paying for electricity."  The way they make it sound, "We're going to put free solar on your roof." Here's the issue. If you financed your solar, the new buyer would need to qualify for credit to take over payments or you must pay off the lease/loan at closing.  

Solar does not add to the value of your home and may make your home harder to sell. Let's say you have a home that sells for $400,000, but you still owe $50,000, $60,000 on that solar system that's on the roof. Your home's only worth $400,000. Now this buyer is qualified for $400k. They will have to get qualified for an additional 50K in order to take over the solar payments. This may cause them to not get financed to purchase your home.

The other downside is once that solar is paid for, it's not really viewed by the appraisers as adding value to the home. According to the National Association of Appraisers, most solar systems on roofs of homes only add about $5,000 to the value if they're paid off, let alone, what issues may arise once a roof needs to be put on the home and why do we do with that solar? You will have to uninstall, reinstall, and what's the cost to come out and get someone to hook it back up?


1 Garage Conversions

Yes, I live in a 1,600 square foot house and when the kids were growing up, we could have used an extra bedroom. It would have been easy to go into our two-car garage, convert that into a bedroom or a bedroom/bathroom combination, add a fourth bedroom to the house, have more room for everybody. The issue arises, however, on the side of my house where the garage is, that's where the drive comes in, it looks like a garage from the outside. Potential home buyer shows up, well, where's the garage? I don't want to park my cars outside.

When you convert the garage, you may be adding square feet to the home, but you might not be adding a whole lot of value as most potential buyers don't want that space. They want a garage. They want somewhere to park their car to get it out of the elements to where they can do, maintenance work, park the lawn mower, that type thing. I don't want an outbuilding that I walk in the elements to get back in my home once I park it at the house.

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Anthony George

Growing up in a family business in rural southern Illinois, I learned the value of making relationships with my clients. Farmers from five neighboring counties knew me by name, and not only did I know....

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